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The need and opportunity for change in the leather sector

Ask someone about leather and usually leather will be related to luxury and durability. The leather sector has provided us with a long-lasting beautiful material. At the same time, the leather sector faces significant environmental and social challenges. Although impact innovations are starting to occur in the sector, there’s still a lot of room for improvement to be made. Enviu builds social ventures that tackle major sustainability issues and has taken on the challenge to improve the leather value chain.

Dieuwertje Nelissen is Venture Builder at Enviu and is leading our Leather Matters program. She travelled to India to research the biggest issues in the leather sector. At Enviu, entrepreneurial solutions always start with an in-depth issue analysis, understanding underlying market dynamics and root causes. This is needed to be able to design interventions towards a new sustainable industry, a new ‘normal’ in 10-20 years. It is what sets the process of building world changing companies apart from realizing relevant but incremental innovation. To make an impact, you need to deeply understand the challenges.

Seeing the need for change first hand in India

In India there are several areas in which the leather industry is active and where you can find multiple tanneries and beamhouses. In beamhouses and tanneries hides are being transformed into leather. During her trip Dieuwertje experienced the differences between the different tanneries: small and large, for export and local production, well organized and more informal.

Her first stop was a tannery. “I was positively surprised about this tannery,” she reflects. “There were security signs in English and the local language, making the signs functional. If they would have been only in English, the signs would be more useful for audits than for the safety of the workers themselves.”

Children playing amongst mountains of mostly leather waste. This picture was taken by one of our Venture Builders in India a couple of weeks ago.

“We also visited factories supplying to high-end brands. These factories were examples of best practices. They are mostly Leather Working Group certified,” Dieuwertje continues. “They start from wet blue, which entails that the hides are already partly processed. The most polluting parts of the process however were not allowed to take place in the city itself, so these are moved to more rural areas which are less densely populated.”

“Next I visited a beamhouse, where hides are brought in from slaughterhouses, with flesh and hair still included. During the visits I always tried to be as unprejudiced as possible, but in this case I was shocked. This was the first time that I felt that the working conditions for the employees were really at a low standard. There was a truck arriving with hides and people were carrying a pile of hides over their heads, the hides were dripping blood, the floor was full of chemicals and organic waste and people were wearing sandals.”

During the visits I always tried to be as unprejudiced as possible, but in this case I was shocked. This was the first time that I felt that the working conditions for the employees were really at a low standard.

Outside factories, the environmental and social impact is clearly present. “On the streets, the factory’s waste is lying around. There are dumps where pieces of hide are being dried. The smell is very distinctive and there are even people living around the dump. All these things added up were definitely a motivator to start making the change.”

The complexity of the leather sector

“People are very passionate about working with leather, they really care about the material. It is a great and very durable material,” Dieuwertje explains. The Enviu team has done more than 200 interviews throughout the sector and entire value chain (from animal to post-life extension) with experts, brands, etc. “On the one hand their passion is beautiful, and on the other hand it is a pitfall. It often leads to discussions about the existence and size of the challenges within the leather industry. As a first reaction they often tend to start defending the industry.”

On the one hand their passion is beautiful, and on the other hand it is a pitfall.

Many people started to ask Dieuwertje about her opinion on the leather sector. She explains, however, that there is not one clear answer. “The leather sector is very complex, and especially in relation to sustainability. Nuances are needed in order to give a balanced opinion.”

Dieuwertje clearly loving India! Although the leather sector is craving change, there is already movement and room for many opportunities.

Dieuwertje gives three nuances: “Firstly, I do see that leather is a by-product of the meat industry and as long as we eat meat there will be hides available. At the same time, the leather industry is a mature industry that can take responsibility for its negative environmental and social impact.”

“Second: On the one hand leather is a very durable material that adds to its sustainability score. On the other hand, you can also see that producing leather often has a negative impact as well.”

“Finally, it is true that some leather producing regions and state-of-the art tanneries perform very well, but we have also seen that still many issues are present in other areas/tanneries and there is strong need to address these.”

Embracing opportunities

So is it all bad? No, it is not. Leather has its sustainability advantages and initiatives are starting to pop up to address the negative environmental and social impact of leather. We also see increasing cooperation with the meat industry.

Is it enough? Then the answer would also be no. The level of innovation and the willingness to change within the leather sector is not strong enough yet. It would be a big game changer if all stakeholders embrace the change towards serving people and planet as an opportunity to do better, instead of as a threat.

It would be a big game changer if all stakeholders embrace the change towards serving people and planet as an opportunity to do better, instead of as a threat.

“Although it is a hard nut to crack, I am really happy we are working to make a fundamental change in the leather sector,” Dieuwertje exclaims. “The sector is in need for change and I am confident we can make a tremendous impact by coming up with new business models.”

Enviu, together with partners, is working towards a leather sector that serves people and planet. Next week we will let you know what solutions we have come up with during the ideation phase to bring the needed change!

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Dieuwertje Nelissen

Venture Builder

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